The cost of food is rising phenomenally fast, with some families set to spend at least an extra £1,000 on food shopping every year, according to the latest research from price-comparison website Mysupermarket.co.uk.

The website's research reveals that the price of a basket of food staples has soared by 21 per cent in the past 12 months. For a family of four spending an average of £100 on their weekly shop, the price rise would mean an extra £1,092 more on food every year.

Mysupermarket assessed the cost of 24 staples from Tesco, Sainsbury's and Asda, including a loaf of bread, potatoes, pasta, rice, orange juice, bananas, apples and milk. Its research shows that it is dairy and wheat-based products that have seen the biggest price rises. This time last year, a loaf of thick sliced bread at Tesco, Asda or Sainsbury's cost less than 50p; now a loaf costs 65p at Asda and Sainsbury's and 72p at Tesco. Similarly, six pints of semi-skimmed milk would have set you back £1.68 last year; this year, they cost £2.12 at all three supermarkets.

The cost of butter has also nearly doubled, from 58p for 250g at Sainsbury's and Asda and 56p at Tesco last year to 94p at all three supermarkets. A 500g bag of pasta, which used to cost 37p, now costs nearly 80p at both Tesco and Sainsbury's.

Johnny Stern, director of Mysupermarket, says: 'We would advise shoppers trying to stick to a tight budget to look out for better-priced like-for-like items and special offers within the supermarket you already shop at - there are significant and regular savings to be had to combat the crunch.'

Families aren't the only ones who are feeling the pinch: research from financial services group Alliance Trust shows that older people, particularly those over 75, are the hardest hit by rising food prices.

Shona Dobbie, head of Alliance Trust's research centre, says: 'Basic food goods are rising at a rate of over 19 per cent and this affects the elderly in particular because these households spend a higher proportion of their budgets on the more basic food items.'

People aged between 65 and 74 spend 13.8 per cent of their household budget on food, says Alliance Trust, and those aged 75 and over spend 16.3 per cent. In contrast, younger people spend less on food - under-30s spend 8.5 per cent of their budget on food, 30- to 49-year-olds spend 10.6 per cent.

Help the Aged says that 2.5 million people - or about half of those aged 75 and above - live alone; they are less likely to benefit from buy-one-get one-free offers, and will often pay higher prices because they are buying smaller quantities. At Sainsbury's, for instance, a four-pint container of semi-skimmed milk costs £1.44, or 63p per litre, whereas a two-pint bottle costs 80p, or 71p per litre.

Enid Burnett, a 69-year-old retired nurse, is no stranger to financial hardship: she divorced 36 years ago and brought up her four children by herself. But she is still surprised at how quickly prices have risen. She shops at Waitrose, and her basket of staples has increased from £15 to £23 in the last six months. 'When I went into the greengrocer's, he had no cauliflowers because he said we wouldn't pay the price they had gone up to,' she says.

She gets about £130 a week in pension and benefits, plus the disabled living allowance and financial help from the charity Elizabeth Finn Care. But still, she says, 'there is very little left at the end of the week'.

Why rates might go up

Hard-pressed homeowners and motorists may feel that the Bank of England is adding insult to injury by contemplating raising interest rates. But the only weapon the experts have for bringing inflation under control is raising the cost of borrowing in the economy - and it works in a brutal way.

If members of the Monetary Policy Committee fear that an external shock, like the current sharp rise in oil prices, is feeding through to rising prices and wages here, the only thing they can do is deliberately to engineer a slowdown. That reduces demand for goods, and increases unemployment, thus helping to keep prices and wages under control.

That is why, although house prices are sliding faster than in the early 1990s, and business confidence has plunged, the Bank feels unable to cut rates: because it fears that would unleash inflation, which could lead to a cycle of instability and recession.Heather Stewart